Workers’ Comp Reforms in Washington State Must Address Fraud

by Matthew Glans on February 23, 2011

A recent editorial in the Seattle Times voiced the paper’s support of Washington Governor Chris Gregiore’s proposed reforms to the state’s workers’ comp system. Her proposals center around reducing costs, limit the number of lifetime pensions and encourage injured workers to return to work as soon as the are able.

From the Seattle Times:

• A statewide provider network. “Some doctors are getting excellent results,” Schurke says. “Others are not.” The governor’s proposals would allow L&I to manage a provider network, like the health insurers do. Now it cannot.

• A wage subsidy for small employers. The idea, from Oregon, is to get the injured worker back on the job, thinking and feeling like a worker, “so as not to develop a disability mindset,” Schurke says. The wage subsidy, lasting up to 66 days, is a way to pay employers to provide light work.

• Raising the permanent partial disability award. Schurke says the current award is so low that claimants are “being driven to hold out for a lifetime pension.”

• A lump sum for workers 55 and up. Workers who could work if retrained are now put into costly retraining programs. Among older workers, Schurke says, “a lot go through the motions of retraining, but their heart is not in it. They just do it to qualify for a pension.” The state would offer them a cash settlement.

• A pension until retirement. Some workers can’t go back to work, but their work injury isn’t the main reason. Now they get lifetime pensions. Under Gregoire’s proposal, they would get a pension until their Social Security starts.

While it is heartening to see Governor Gregoire undertake a strong effort to improve Washington’s workers’ comp market, an important part of the problem that goes unnoticed far too often still needs to be addressed.

A greater effort to combat fraud should also be at the center of any new workers’ comp reforms. Cracking down on fraud is a necessary prerequisite to further reform. Before any additional money is borrowed or spent for workers’ comp programs a serious review needs to be conducted of how the money is now being distributed. Only after the sieve is closed should any additional funds be acquired.

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  • lniwafraud

    Thanks for this thoughtful entry on workers comp reform. As the manager of the Fraud Prevention & Compliance program, I wanted to comment briefly to assure your readers we are indeed taking measures to detect and prevent fraud. nnL&I fraud has been front page news lately, and we are pleased this critical issues is getting attention. Just this week, The Olympian editorial board gave kudos to L&Iu2019s fraud fighting efforts, highlighting the import role the public plays in tipping us off about those who may be abusing the system. nnSome background now on our recent accomplishments u2013 in fiscal year 2010, L&I collected a near-record $137.4 million. That total includes payments from employers for delinquent or falsely-reported premiums, plus recovery of payments to injured workers and health care providers made on fraudulent claims. Large collection numbers during tough economic times prove we are getting better at targeting fraud, enforcing the law, and helping struggling employers stay in business and pay their bills. nnIn addition, in FY2010, the Fraud Prevention and Compliance Program:nnu2022t Completed a record 5,846 employer audits, assessing $26.4 million dollars;nu2022tCompleted a record 5,789 claim investigations, a 12% increase over last year, with no increases in staffing;nu2022t Forwarded 17 fraud cases for criminal prosecution, with a 100% conviction rate;nu2022t Returned more than $7 for every dollar invested in the program.nnnBy the end of 2011, we will have completed the installment of advanced fraud analysis software to better detect employer fraud and employee misclassification. nnWhile improved detection is critical, we also depend on tips from the public and investigate every lead. If you suspect someone of fraud, let us know by calling our fraud hotline at 1-888-811-5974 or online on our website at nnYou can also read more about the fraud programu2019s efforts on my fraud blog The blog feature stories of recent convictions, developments on technology improvements, and surveillance video from investigations. Check it out and leave a comment, Iu2019d appreciate your feedback there.nnnThank you,nnCarl HammersburgnManager, L&Iu2019s Fraud Prevention and Compliance n

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